Iceland's Foreign Minister, Ossur Skarphethinsson, has said Britain and the Netherlands have indicated a willingness to continue talks after voters overwhelmingly rejected a proposal to repay a €3.8bn debt.
The two governments are claiming the money after refunding savers in the collapsed internet bank, Icesave, in 2008.
With 33% of the votes counted in a referendum, 93% voted ‘No’, while less than 2% supported the deal, and the remaining votes were invalid.
Mr Skarphethinsson said the referendum result would not weaken the Icelandic government's hand in negotiating a new repayment deal with the two countries.
Some observers had warned that a ‘No’ vote might result in the International Monetary Fund blocking the remaining half of a $2.1bn rescue package.
It could also affect European Union and euro currency membership talks.
However, Iceland's President, Olafur Ragnar Grimsson, insisted the referendum had already 'had a very positive effect. It has moved the British and the Dutch towards a fairer deal.'
